Public-sector banks’ employees are set to get a 17% rise in salaries after the Indian Banks’ Association (IBA) and bank unions signed a memorandum of understanding (MoU) on the 12th bipartite settlement in early December.
The government may approve the much-awaited five-day working week for banks before the the model code of conduct (MCC) kicks in later this month for the general elections, bringing in cheers to over 1.5 million bank employees, an official source said.
Public-sector banks’ employees are set to get a 17% rise in salaries after the Indian Banks’ Association (IBA) and bank unions signed a memorandum of understanding (MoU) on the 12th bipartite settlement in early December. However, the unions had urged implementation of a five-day work week within 180 days, as they signed the final bipartite agreement.
The government is supportive of the proposal and industry bodies have also come on board on the issue, an official said. “The government was waiting for an opportune time for announcement of the five-day week and probably that time has now arrived,” the official said, pointing to the electoral advantage it would offer for the ruling dispenastion if announced before polls in April-May.
Currently, both public sector and private sector banks work on the first and third Saturdays of the month. After approval of the proposed changes, the government will notify all Saturdays as holidays under Section 25 of the Negotiable Instruments Act.
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Currently, both public sector and private sector banks work on the first and third Saturdays of the month. After approval of the proposed changes, the government will notify all Saturdays as holidays under Section 25 of the Negotiable Instruments Act.
It may be recalled that the government had issued a notification on August 20, 2015, declaring every second and the fourth Saturday of every month as a public holiday under Section 25 of the Negotiable Instruments Act of 1881. Accordingly, all scheduled and non-scheduled banks – public, private, foreign, cooperative, regional rural and local area banks – are currently observing public holidays on second and fourth Saturdays from September 01, 2015.
Currently, government offices and RBI offices (except for support services to banks on two working Saturdays) work five days a week. Life Insurance Corporation of India also works five days a week for its employees.
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After prolonged negotiations between the IBA and employee unions, the IBA approved their proposal in November to make all Saturdays a holiday for bank staff. The IBA had sent the proposal to the finance ministry for consideration.
While some bank managements have raised concerns about the impact on their businesses and productivity, the trade and industry also had some fear their business and credit flows might be impacted. “Industries do not have any issue with it now,” another official said, but timing of implementation was still an issue.
There are 1.54 million employees in the banking sector , equally split between public and private sectors, including payment banks and small finance banks. Separately, there are about 95,000 employees in Regional Rural Banks. The 5-day week norm will likely be made applicable to RRBs too.
All these banks may have to take some steps to ensure that the increased number of holidays doesn’t impact the banking operations in the country, besides stepping up digital and ATM services.
As part of the agreement for a five-day working week, the working hours for banks could be increased by 45 minutes per day to offset any loss of work.
